With Kentucky considering pursuing a waiver that makes changes to its Medicaid program — and looking at Indiana’s waiver design in particular — it is important to keep in mind how much we still don’t know about the model’s implementation and effectiveness.
As shown in a new paper by the Center on Budget and Policy Priorities (CBPP), there are serious questions about the data coming out of Indiana. As CBPP argues, it’s unwise to replicate the ideas Indiana has piloted before they are thoroughly evaluated.
Indiana is one of six states currently using waivers to implement their Medicaid expansions. The law around waivers says they are intended to provide additional flexibility to states and act as demonstration projects to test ideas while still promoting Medicaid’s objective of delivering health care services to vulnerable populations who can’t otherwise afford them.
Indiana was granted a waiver for Healthy Indiana Plan (HIP) 2.0, to test the impact of premiums on participation in health coverage and the efficient use of health services. HIP 2.0 is supposed to test whether or not its monthly premiums are affordable and do not create a barrier to health care access.
State and federal evaluations of the waiver have not yet been completed and there are many concerns and unanswered questions about its implementation. Specifically, there are concerns about whether or not the program is following through with its design to base premiums on beneficiaries’ actual incomes and collect data on third-party payments.
For instance, based on reporting so far, the state seems to be counting an improbably large number of enrollees as having little or no income, which makes premium amounts easier to calculate and collect. Indiana reports over half of HIP 2.0 enrollees have incomes below 5 percent of the poverty line, even though Census data show that only 12 percent of Medicaid expansion-eligible adults have incomes that low. Under the program, those very low income participants pay $1 a month and no calculations around premiums as a share of income are required.
The extent of third-party premium payments occurring with HIP 2.0 is also unclear. Indiana is reporting on the number of HIP 2.0 participants whose premiums are paid by employers and non-profit organizations — but not by health care providers or other third parties. For instance, they recently reported to the Centers for Medicare and Medicaid Services (CMS) that some payments on behalf of Medicaid participants may not be captured in the numbers reported — i.e., from hospitals, friends and family. As noted in the CBPP paper, “If third parties are paying premiums for a large share of beneficiaries and this is not being reported to CMS, the demonstration is not a true test of the impact of premiums on enrollment and utilization of services.”
Without accurate data on premium payments, conclusions cannot be made about whether or not they are manageable for low-income participants. Past research has overwhelmingly shown premiums have a negative impact on health care access.
Indiana’s waiver was also granted to test whether presumptive eligibility and fast-track prepayments will prevent gaps in health care coverage. These mechanisms are important as HIP 2.0 delays coverage until premiums are paid (or those with incomes below the poverty line are shifted to more basic health benefits after 60 days). However, there are important questions that need to be answered about how Indiana is implementing presumptive eligibility and fast-track prepayments.
Presumptive eligibility allows providers to screen and immediately enroll in Medicaid persons who appear to be eligible so they can begin using benefits right away while they complete the eligibility process. Fast-track prepayments are $10 payments made when applying for Medicaid, before eligibility is determined, that allow those found eligible for coverage to have it starting on the first day of the month they are found to qualify.
However, Indiana’s reporting to CMS raises questions about how the state is implementing presumptive eligibility. For instance, it appears that a declining share of providers are participating. In addition, Indiana’s reports to CMS lack data on the number of individuals making prepayments, which makes it unclear whether they mitigate harm from delays in coverage.
These unanswered questions mean we don’t know whether or not the Indiana Medicaid waiver model negatively impacts access to health coverage. Kentucky should not model its Medicaid program after an unevaluated approach, at least until there is a full understanding of its results. Our state’s Medicaid expansion has been very successful at insuring low-income Kentuckians and promoting preventive care for participants. Changing the program in ways that potentially reduce access to coverage would be detrimental to many individuals and the state as a whole, which benefits from having a healthier population.